RIA Compliance Blog
On October 22, 2014, Michigan took a significant step to increase investment crowdfunding opportunities for Michigan businesses by becoming the first state to establish an intrastate market where broker-dealers can sell securities of Michigan-based companies. While “crowdfunding” can have different meanings, including rewards-based fundraising campaigns on sites like Kickstarter and Indiegogo, “investment crowdfunding” generally refers to small businesses seeking investment capital in small amounts from a large number of investors.
The signing of House Bill 5273 by Governor Rick Snyder, along with the state’s preexisting registration exemption for securities issued by Michigan businesses under the Michigan Invests Locally Exemption (“MILE Act”), allows Michigan business to raise capital over the Internet or though general solicitation by selling the exempt securities within a newly-created alternative intrastate market.
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